Need to know — Financial reporting effects of the UK Apprenticeship Levy
The Government has committed to developing vocational skills, and to increasing the quantity and quality of apprenticeships with an aim of facilitating an additional three million apprenticeships in England by 2020. As part of this initiative, from 5 April 2017, employers in the UK with an annual pay bill exceeding £3 million are charged a levy of 0.5% of their ‘pay bill’ (defined as payments to employees subject to employer Class 1 (secondary) National Insurance Contributions) less a £15,000 annual allowance to be paid via the PAYE process. Both the £3 million threshold for payment of the levy and the £15,000 allowance are calculated on a combined basis for connected companies.
Amounts paid via the levy can, together with amounts contributed by government, be used to fund approved training/assessment programmes.
This Need to know publication discusses the financial reporting effects of the Apprenticeship Levy.
